Luxembourg banks, clients thrived during pandemic
Luxembourg's banks navigated the pandemic without much damage to their business, a survey conducted by industry assocation ABBL showed on Tuesday, expanding the size of the sector by almost 10 percent.
Retail banks, which mainly help everyday clients, expanded the total size of their balance sheet by 9.3% to €92.4 billion over 2020, with most of the money held in current or savings accounts, the ABBL said in a press release.
Banks had seen a 6% rise in digital transactions and a 25% drop in cash withdrawals, ABBL said, basing itself on a survey among Luxembourg banks.
Private banking - which is geared at investing money from well-off clients - did equally well, as assets under management rose by almost 10% year on year, to reach €508 billion at the end of 2020. The number of private banks remained the same at around 55 to 60 banks, ABBL added.
Clients on average are also wealthier. The proportion of "ultra-high net worth clients" - who have more than €20 million available to invest - increased to 58% compared to 54% in 2015. The share of clients with less than €1million in assets shrunk to just 7% in 2020, from 13% in 2015, ABBL said.
There has also been a marked change in the origin of the money. While Belgium, France and Germany accounted for around half of client assets 15 years ago, two of these three countries did not make the top spots in 2020, when 21% of assets were from Luxembourg, with the UK, Belgium, Italy and Switzerland completing the top 5. Around 15% of funds came from outside Europe.